Emerald Business Systems Blog


XBRL: Accounting Geeks Get Radical

Posted in General Business by ebs4pos on November 29, 2009

It is not often that something as deeply geeky as XBRL gets onto the front page of Wired magazine. Daniel Roth's superb article about radical transparency raised the profile of those four letters. What could be more boring than an XML standard for accountants that has been around for a decade? On the other hand, what could be more exciting than something that might disrupt and recreate the deeply broken global financial system? I spent two days at the XBRL US National Conference in New York to find out the reality, which is somewhere in between.

The Ultra-Fast XBRL 101

For XBRL newbies, here are a few key facts and some links for further research:

* XBRL stands for eXtensible Business Reporting Language.

* It is an open standard based on XML, created by an accountant named Charlie Hoffman. Read some quick facts here.

* If you tag something consistently, software applications can more easily analyze the data and present more useful information. Yes, that sounds like the semantic Web, and we all know that has faced the chicken-and-egg problem (i.e. not enough content is semantically tagged yet). But imagine a semantic Web standard for which governments around the world tell companies that they have to tag data that way.

* XBRL gained attention in the US when the SEC mandated that public companies report their financial results in XBRL (starting with companies that have a market cap over $5 billion). That has been going on for two quarters now, so all parties are getting real-world experience with XBRL.

* But XBRL traction is greater in other countries, especially Japan, Australia and Holland, where it is being used to standardize and simplify reporting to government regulators. In the UK, companies report to the taxman using XBRL.

The Twitter hash tag is – you guessed it – #xbrl.

via XBRL: Accounting Geeks Get Radical – ReadWriteEnterprise.

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